Government entity issuers of tax-exempt bonds affected by Hurricane Sandy may qualify for additional time to file certain returns related to tax-exempt bonds, qualified tax credit bonds, and specified tax credit bonds.
Following recent disaster declarations for individual assistance issued by the Federal Emergency Management Agency, affected government entities in covered disaster areas in Connecticut, New Jersey, New York and Rhode Island will receive filing and payment relief.
Affected issuers who are required to file a Form 8038 series information return or a Form 8038-T in connection with an arbitrage payment, with a due date between late October and Jan. 31, 2013, may file such returns and make such payments up until Feb. 1, 2013.
Affected issuers may also file such returns and make such payments up until Feb. 1, 2013, if the records necessary to make such filing or payment, the conduit borrower, or the bond counsel or other profession upon whom the issuer relies to make such filing or payment are located in a covered disaster area.
The IRS will abate any late-filing penalty that would otherwise apply. The IRS automatically provides this relief to affected issuers located in covered disaster areas. Issuers need not contact the IRS to get this relief. However, affected issuers should clearly indicate on the top of the return that such late filing or payment is the result of devastation caused by Hurricane Sandy.
In addition, an affected issuer required to file a Form 8038 series information return or a Form 8038-T in connection with an arbitrage payment, due between late October and Jan. 31, 2013, may request authority to file a Form 8038 or Form 8038-T after Feb.1, 2013, by requesting an extension under Revenue Procedures 2002-48 and 2005-40, which provide guidance on how issuers may request extensions of time to file Form 8038 series information returns and waivers of penalty associated with a late arbitrage payment. Affected issuers should request relief in accordance with these revenue procedures and clearly indicate that such late filing or payment was the result of devastation caused by Hurricane Sandy.
In addition, a Form 8038-CP authorized to be filed by an affected issuer between late October and Jan. 31, 2013, but filed thereafter, will be immediately processed upon receipt.
So far, IRS relief for affected issuers applies to the following covered disaster areas:
- In Connecticut (starting Oct. 27); Fairfield, Middlesex, New Haven, and New London Counties and the Mashantucket Pequot Tribal Nation and Mohegan Tribal Nation located within New London County;
- In New Jersey (starting Oct. 26): Atlantic, Bergen, Burlington, Camden, Cape May, Cumberland, Essex, Gloucester, Hudson, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Passaic, Salem, Somerset, Sussex, Union and Warren;
- In New York (starting Oct. 27): Bronx, Kings, Nassau, New York, Orange, Putnam, Queens, Richmond, Rockland, Sullivan, Suffolk, Ulster and Westchester;
- In Rhode Island (starting Oct. 26); Newport and Washington Counties.
Related Item: Help for Victims of Hurricane Sandy